Havoc in the workplace

ON THE JOB

Employee attitudes slump with economy as jobs are cut and survivors feel anxious, overworked

November 14, 2008|By HANNAH CHO | HANNAH CHO,hanah.cho@baltsun.com

It's an understatement to say that the recession is causing havoc in our workplaces.

Workers are feeling uneasy and anxious about their futures, while employers are trying to manage businesses amid a worsening economy.

The wave of job cuts is a stark consequence and reminder of how bad the labor market and working environment have become.

Two recent surveys provide a snapshot of how employers plan to deal with a slumping economy and how layoffs are affecting workers.

First, consider the grim economic indicators: Last week, the Labor Department reported that employers cut 240,000 jobs in October, bringing the nation's unemployment rate to 6.5 percent, a level not seen since 1994. And the federal agency said yesterday that jobless claims climbed to a seasonally adjusted 516,000, a level we have not seen since just after the Sept. 11 terrorist attacks.

One study of worker attitudes and moods during the post-Sept. 11 recession gives a pretty clear indication of what to expect after these most recent job cuts.

Employees who survived the post-Sept. 11 layoffs reported higher worker insecurity, more stress, less teamwork, heavier workloads and a feeling that they are less valued, according to Sirota Survey Intelligence, a New York firm that specializes in attitude research.

Put another way: It is becoming increasingly difficult for many workers to go into the office each morning.

Sirota, which released its findings this week, examined the attitudes of nearly 500,000 employees in 2000 and in 2002. It found, for example, that 67 percent of employees in 2000 felt valued by their organization, compared with 44 percent who felt that way in 2002.

More than 80 percent of workers in 2000 viewed favorably cooperation and teamwork within their work units, compared with 71 percent two years later.

And when it comes to advancement opportunities, 48 percent of workers in 2000 were confident of climbing their company's ranks. That figure dipped to 39 percent in 2002.

While layoffs seem to get most of the attention, employers are taking other actions to address the tough economic conditions.

Eileen Levitt, president of Columbia-based The HR Team, a human resources consultant firm, says employers, especially small ones, are in a tough spot.

"The cost of business is going up dramatically, and you have less business to support it," she says, noting that her clients have seen a 20 percent to 30 percent increase in health care premiums, among other costs.

According to a Society of Human Resource Management survey of nearly 450 HR officials, 55 percent said hiring freezes are also likely if the economy gets worse.

Other likely actions included cutting bonuses (50 percent), freezing salary increases (45 percent) and job cuts (39 percent).

More than 80 percent said they would consider providing their employees with financial educational literature or workshops.

Some 21 percent of HR executives said they might revise investment policies for 401(k) plans and other savings programs.

Seven percent said they might consider offering employees investment options other than 401(k) plans, while 11 percent said they might change investment management companies.

Already, a number of companies have opted to cut back or stop matching 401(k) employee contributions. GM, for instance, temporarily stopped 401(k) matches as of Nov. 1.

A survey released in October by consulting firm Watson Wyatt found that 2 percent of 248 employers have already reduced their 401(k) or 403(b) match. Another 4 percent plan to follow that action in the next 12 months.

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